America’s 99 percent to be hit with 50% increase in taxes

By KEITH FITZ-GERALD | ETF | DECEMBER 11, 2012

If I didn’t know any better, I’d think there’s a small but growing group of people in Washington who think it would actually be good if we temporarily went over the fiscal cliff.

I say that because I am seeing a smattering of articles recently suggesting that somehow going over the cliff “won’t be all that bad” or that we’re “really just talking about cuts that need to happen in the first place.”

President Obama seems to think the same way judging by the fact that he’s dug in his heels, telling the GOP there will be no fiscal cliff bargain that doesn’t include tax hikes.

Now noted budget hawk Republican Senator Tom Coburn has broken ranks, noting that he’d rather see rates rise because that “will give us a greater chance to reform the tax code and broaden the base in the future.”

I find that to be an absolutely appalling argument given how much further the president’s proposals will squeeze the middle class.

As Fox Business Network’s Gerri Willis, an expert on consumer and personal finance issues, recently pointed out to me, the average middle class tax rate is already 43.12%, according to the non-partisan Tax Foundation.

Beyond that, Willis says if we do go over the cliff, the average middle class tax burden jumps to nearly 50%.

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What’s the US like today? More taxes, more Unemployment, more Homeless, more Alcohol Sales

by Luis R. Miranda
The Real Agenda
February 1, 2012

Often times, people want to know what exactly is the United States like. Most people have the wrong idea as it turns out. In many countries, where people believe that having it all is what life is all about, they still see the US as the bright house on the hill. “It is very different from when I used to live there,” I frequently respond. The key here is that the changes that have taken place in the United States, most if not all of them for the worst, have happened fast. The most significant to much of the population there took place in the last decade.

Most of the negative changes have to do with the loss of liberty and freedom, a consequence of the out-of-control growth of the federal government. Today even the main stream media can’t hide the reality the US is in; not even the liberal pro-Obama corporate media. (MSNBC, NBC, CNN, NYTIMES, TIME, NEWSWEEK, FOX and so on). The abhorrent situation in which the United States find itself in right now can be measured by at least 4 variables: Taxes, Unemployment, Poverty and Alcohol Sales.

The Federal Government’s Golden Egg Goose: You

Let’s start with taxes. The power to tax is the power to enslave. I don’t know how many times I’ve heard that sentence, but I doubt many people in power truly understand what it really means. Probably fewer than a handful are willing to act to correct what it means. Up until 1913, the United States Federal Government and the States were functioning pretty well without an income tax, but the monies collected through taxation were not enough to grow the government to the levels the controllers wanted. Today, the income tax eats up much of the fruit of people’s hard labor. And when the taxes are not enough to support the ever-growing bureaucracy more taxes are imposed on the population. That is how it has been for almost 100 years. But the growth of the Federal Government and its outreach to gain more power is not the only reason why it needs to tax more. If you don’t believe the government has no money to pay teachers, policemen, firefighters and other local and federal workers, you are probably aware of the infamous Comprehensive Annual Financial Reports. This is the double set of books all cities and states have. One has the accounting most people think they know, the other one has the record of the monies that were taken from the governments’ safe to do things you probably don’t know about. Meanwhile, corporations and banks get easy credit from the Federal Reserve window, in addition to being bailed-out with trillions of dollars from the tax payers. Oh the other hand, average people have had to tighten their belts if they were lucky to keep their jobs over the last 10 years. Although the economic crisis is said to have begun in 2008, the truth is that it started way before that, even before George Bush came into office.

If anyone can expect that during a republican administration taxes be lower, someone can also count on higher taxes during a democratic administration. Unfortunately, republican tax cuts are usually applied to the very rich, and democrat tax increases are applied to the middle class and the very poor. See, either way people lose. The last decade has been the worst for the people of the United States, probably since the last Great Depression. But the situation does not seem to be getting any better. Who’s fault is it? Every single president who did not have the cojones to stand up to the off-shore corporations that have controlled the central government at least since 1913. According to the Congressional Budget Office (CBO), there will be no relief for American tax payers in 2012, either. In fact, taxes will increase by at least 30 percent in the next two years. That number is valid if we leave aside the other taxing practice the Federal Government has used for 100 years, and that is currency manipulation, or the artificial devaluation of the dollar by printing money out of thin air.

Higher taxes not only mean a bigger Federal Government, but also less recovery, less jobs, less income, less liberty and freedom. This outlook will be so due “mostly because of the recent or scheduled expiration of tax provisions, such as those that lower income tax rates and limit the reach of the alternative minimum tax (AMT), and the imposition of new taxes, fees, and penalties that are scheduled to go into effect,” reads the CBO’s document.

How could there be a recovery when the Federal Government eats a big chunk of the monies collected through taxes and almost none of it is put to work for the tax payers? Numbers by the CBO show that federal tax revenues reached $2.302 trillion in fiscal 2011, and will increase to $2,523 trillion in fiscal 2012, $2,988 trillion in fiscal in 2013, and $3,313 trillion in 2014. The report adds that as a percentage of the GDP, tax revenues were 15.4 percent in fiscal 2011, and will be 16.3 percent in 2012, 18.8 percent in 2013, and 20.0 percent in fiscal 2014. In other words, the Federal Government will have even more money to spend than in previous years. It is unlikely though that the government will spend the money in programs to grow the economy, create jobs and improve the debt issue. In fact, in January the Federal Government increase de debt by another trillion dollars. That is where the forecast for a sluggish economy for the next six years comes from.

More taxes, less jobs

Let’s talk unemployment. With cooked numbers, the government says the unemployment rate is at about 7 percent. The CBO has come out to say it is really 10 percent. However, it is likely that such rate has reached 20 percent by now, since it was calculated at over 17 percent in 2009. The Federal government has taken it upon itself to encourage companies to move abroad, instead of promoting the United States as the place to be, to create jobs, to produce goods and to sell their products. Higher taxes at home together with corporate greed prompted companies to move to Asia and Latin America at an accelerated pace. At the same time, higher taxes and a slow economy have ended with local entrepreneurship and opened the door to entities like Wal-mart, IKEA, and businesses alike which make their money by exploiting third world workers to produce garbage that is then sold in the United States and the rest of the world. If you are a socialist or communist and believe that consumerism is bad for the environment and humanity as a whole, check out what cheap labor and cheap products do to both.

Since approximately 2000, the United States has lost 6 million manufacturing jobs. Most of these jobs, as I have said, moved to Mexico, Brazil, India, China and other countries around the world at the expense of American tax payers. A study conducted by the Economic Policy Institute shows how the American trade deficit with China causes the United States to lose about half a million jobs a year.  Separately, tax records indicate that up until 2008, employment offered by U.S. parent companies created 10.1 million jobs abroad through their affiliates in countries like the ones mentioned before. That is about half the number of jobs that multinational corporations cut in the United States during the same period. The total amount? 21.1 million. Manufacturing is no longer as much of a significant activity in the US as it was 50 or 60 years ago, when 28 percent of the economic output was directly related to the production of goods on US soil. Today, it is less than half; 11.5 percent.

Have you heard about the NAFTA effect? In case you don’t know what NAFTA is, it would be a great idea to ask Bill Clinton and Al Gore, the parents of this child. The North American Free Trade Agreement signed under the Clinton administration was supposed to be, according to Clinton and Gore, the best invention since the assembly line came into existence. Ironically, NAFTA is mostly responsible for killing the assembly line in the United States.

Free trade is not bad when there is a leveled field for all participants who trade, or as long as losses here can be with earnings there, if you know what I mean. However, this is not what NAFTA did for the US after it was signed by Clinton in 1994. NAFTA supporters contradict the idea that this agreement was negative for the US, because according to them the US experienced a significant increase in GDP as a result of the implementation of NAFTA. They often compare post NAFTA numbers to pre NAFTA ones to make their arguments. The positive outcomes of NAFTA are presented and described in macroeconomic terms, because it is easy to make up talking points to feed the main stream media so that they can regurgitate to the public. However, as we showed before, NAFTA is indeed responsible for the loss of manufacturing jobs. This loss did not occur immediately after NAFTA was implemented, as most companies did not move abroad right after NAFTA was adopted. The runaway loss of jobs came late in the 90’s and across the millennium into the 21st century. One single report by economist Robert Scott, from Economic Policy Institute accounts for the loss of at least 700,000 jobs due to NAFTA. Read the complete report “Heading South: U.S.-Mexico trade and job displacement after NAFTA”. Opinions about how NAFTA helped or harmed the US economy will continue to abound, but the truth is that the proof is in the pudding.

Bye, bye American Dream

Personally, I do not believe in the so-called American Dream, so forgive me if you do. But regardless of whether it was real at some point, perhaps people in the US (99 percent of them) would agree that it went poof in the last ten years. Depending on who you ask, the most important symbol of making it in the US is to own a home, even though in most cases people don’t really own their houses; the banks do. This is another aspect that changed in the United States in the last decade. Although the new millennium saw more and more Americans getting loans to buy houses, we now know it was just a planned bubble, that was supposed to explode to leave millions of people homeless all across the country.

No matter how much main stream media outlets swear by it, the downturn isn’t ending any time soon. Along with the deepening bad economic conditions, home ownership has also taken a big hit. As of today, the number of home owners in the US has fallen 66 percent. This figure comes from the US Census Bureau and it was revealed this morning. But the lack of home ownership is not new. It is a trend Americans have seen more strongly for at least the last thee years. Along with the fall in home ownership comes the fall in home prices at rates of 1.3 percent in November and 3.7 percent in October. The numbers above are reminders of conditions experienced only back in the days of the Great Depression. So when the corporate media says the country is on the rebound, you can be sure that is one of the boldest lies you’ve heard. It may be different for Wall Street insiders, of course.

The main two reasons for the fall in home ownership? Lack of available credit -not due to the lack of money- and few financing options for potential homeowners. Economist Paul Dales, says that even if people want to get a house, it is difficult to do so, because no financing for a mortgage is available. How would any financier risk to help anyone if home prices will continue to fall this years and into 2013? The number of existing homes that remain vacant remains at around 2.5 percent; quite an inventory for buyers to choose from. But are there any buyers? There certainly are a lot of homeless people who need a place to crash. The drop in home ownership has seen its worst in the West coast, where the rate reached 60.1 percent according to census data. This scenario is not surprising, because if people don’t have jobs, well paying stable jobs while being  slaves of the IRS, it cannot be expected that they become potential homeowners.

A tool of last resort: Alcohol?

Desperate times call for desperate measures. What are the chances that alcohol sales increase on a yearly basis during an economic downturn? I am in no way saying that this increase is a direct consequence of the global crisis, but it wouldn’t be a surprise. “US shipments of scotch, vodka, rum and other spirits in 2011 increased 2.7 percent over the previous year — the strongest increase in five years, according to industry data,” reports Fox News. A rate of 2.7 percent doesn’t sound like much, but if this percentage is quantified, maybe we can get a better perspective. “Sales of “high-end” brands were up 5.3 percent last year, in line with the pre-recession average of 5.8 percent. At least we know what sector of the economy has the potential to grow. So divest your 401K, savings and other financial products into food, water and perhaps alcohol industry shares?

9-9-9: The Devil is in the Details

By Steven Thomma
McClatchy Newspapers
October 12, 2011

WASHINGTON — Republican presidential candidate Herman Cain’s proposed 9-9-9 tax plan would shift the tax burden in the United States, raising taxes on the poor while cutting taxes for the wealthy.

Former CEO of Godfather Pizza, Herman Cain

Cain proposes to scrap the current tax code and replace it with a flat 9 percent tax on personal income, a second 9 percent tax on corporate income, and a third 9 percent tax on sales. It also would eliminate the payroll tax paid for Medicare and Social Security, the estate tax, and capital gains taxes.

While the Cain campaign has not produced enough details for thorough independent analysis, a flat 9 percent income tax and a 9 percent national sales tax would almost certainly mean higher taxes for at least the 30 million U.S. households that now pay no federal taxes.

And it almost certainly would mean big tax cuts for the wealthy, who now pay a 35 percent marginal rate on their income above $379,150.

The catchy 9-9-9 tax plan has helped the former Godfathers pizza CEO surge into the top tier contending for the 2012 Republican presidential nomination. With his rising support, Cain’s plan is drawing more scrutiny, with the potential shift of the tax burden just one of the profound effects the dramatic change in tax policy could have — if Cain were elected and managed somehow to get it past an army of lobbyists and through Congress to enactment.

Ultimately, in a second phase, Cain’s plan would eliminate all income taxes for individuals and for corporations in favor of a national sales tax. To raise sufficient money to fund the government, the sales tax rate would rise significantly, perhaps to 23 percent, analysts estimate, though Cain hasn’t specified a level yet.

The changes in income taxes would turn away from the progressive tax policy that’s shaped U.S. policy for a century, based on the principle that the wealthier people are, the more they can afford to pay in taxes to the society that’s enriched them.

“The plan could be expected to raise substantial amounts of revenue, but does so largely by skewing downwards the distribution of tax burdens,” said a new analysis of the Cain plan this week by Edward D. Kleinbard, a professor of tax law at the University of Southern California. He’s also a former chief of staff at the congressional Joint Committee on Taxation, which analyses all tax legislation for Congress. “The 9-9-9 Plan would materially raise the tax burden on many low- and middle-income taxpayers.”

Others agree.

Read Full Article…

The Horizontal Power of the State

by Luis R. Miranda
The Real Agenda
July 13, 2011

How many liberals, libertarians, conservatives and anarchists, to cite a few, dislike the outcomes that result from having an out of control State? It would be interesting to carry out a survey and find out exactly. However, a survey is not necessary, unless you are a statistics or a math fan, to learn that most people are dissatisfied with the current state of affairs. Proof that government involvement causes more harm than good is in every aspect of life. But it is not government or the State the party responsible for such outcomes, it is the people who support those States or governments who carry the blame.

 Although government and the power structures are seen as built in a pyramidal shape, the truth is that the government or State is built horizontally. See, government is composed by the people that give it the legal and moral support to exist, and so those very same people are responsible for whatever the State or government does or does not do. Therefore, all things that originate from the State -good or bad- are a direct result of the people supporting the system we know today as the government or the State.

 The problem is, most people do not know or understand this. People complain about the current state of affairs without realizing that they are to blame for the misery they are experiencing. Other people do recognize it, but are too hypocrite or afraid to do something about it. They do not speak against it because they fear social rejection. Those afraid should be happy to know that the problem of an abusive and out of control State or government is solved with actions, not words. Why? Because language is so fragile that it can be bent in all sorts of ways to say whatever anyone wants. It is nearly impossible to inject a dose of common sense into anyone who has been previously indoctrinated; and we all are to a certain degree. However, if one acts on something that is seen as wrong or abusive, other people will see what we mean and realize, all by themselves, that our actions make more sense than what they have thought all their lives to be true.

 Waking people up so that they act to change the current state of affairs is an impossible task if one only uses words. The reason for that is culture has rooted so deeply into their minds, that people’s reality is nothing else than what culture tells them it is. Nothing else. As it is widely clear, culture does not ‘teach’ people reality or truth, but a mixture of half-truths and plain open lies. How do you make people understand that although the Nazis directly killed 6 million jews and indirectly murdered a total of 40 million people, there is another entity that has killed almost seven times more humans than the Nazis did. It may come as a surprise to many that in modern times States or governments are responsible for the deaths of at least 262 million people. That is a fact that culture will not tell anyone.

 In our culture-created ‘reality’ the problem is terrorism, but instead of dealing with the root causes of terrorism, the State treats its bosses -the people- as criminals; all of them. Suddenly, everyone is guilty until proven innocent and everyone submits to this way of thinking. It is checking the inside of the shoes I am wearing what will solve the problem of terrorism, culture tells us. It is giving the State a photo of my naked body what is seen as the solution to end terrorism, the media tells us. Meanwhile, the terrorists, the real terrorists, who operate the scanners at the airports, who killed at least a million people in Iraq, who cleansed Bosnia and who are now cleansing Libya, Pakistan, Yemen and Syria use people’s complacency to continue doing all those things we dislike so much.

 People support the state and everything it does because that is how they were raised. Depending where you live, the educational system taught you anything from obeying to worshipping the State. Along with that indoctrination comes the role culture plays in people’s lives. Culture reinforces the paradigms we have all brought up with, so that everything continues business as usual. Humans were grown to accept and demand an explanation of reality that should never change, and that is that the State, any State, has our best interests in mind. That is why we must all pay taxes on our properties for the rest of our lives, even though we purchased them and paid taxes on the purchase. That is why we elect people from two majority parties and believe that the system gives us a choice. That is why we all obey the laws created by the State, although it does not obey them itself. This happens because the laws are for the slaves, not the masters. And guess what? The masters are also humans like you and me, no matter how much they like to think of themselves as superior beings.

 The problem with culture-created ‘reality’ is that because it is factually false, it needs continuous support to make it believable. It is exactly like “tell a lie a thousand times and it will become truth”. That is what culture does. People who believe in the system of paradigms imposed by the social engineers paradoxically require a constant reinforcement of what they believe is true. So, for example, people have been taught that world war I was fought for the sake of democracy, or that government came after the Great Depression to save everyone, or that world war II happened to save Capitalism, or that the central banks exist to control the horrendous forces that make the free market imperfect and dangerous. The problem with all these false realities, which to many of us are real, is that our future and the future of our sons and daughters will be shaped by the decisions made by people who believe these false truths.

 This is so because everyone thinks the State or government exists to fix everything that is wrong and therefore there is nothing to be afraid of. Right there is the origin of the Nanny State. Since individuals are not capable of managing their own lives -that is what we have been taught- there will always be a State to put the knob on the screw that got loose, an entity to give us all we need. What people do not realize, is that that same entity, if allowed, will also take away everything it handed out because of the power vested upon it. It is because the reality created and reinforced by culture revolves around collectivist views of dependency, that the State has become the inconvenience it is today. Although the evidence shows that this entity we all supposedly owe everything we have to, has destroyed everything it has touched, the level of indoctrination people are under not only does not allow them so see such destruction, but also automatically directs them to seek more reinforcement of their false reality.

 From education to economy, from foreign policy to welfare, the State has shredded everything. Intentionally, by the way. It is precisely because the evidence does outmatch culture and the false paradigm that people continuously go back for their daily, weekly and monthly dose of false ‘reality’. That is why the social engineers made sure there is a New York Times, CNN, Dancing with the Stars and American Idol; so the slaves get their blue pill whenever they need it and do not threaten to leave the human farm. The blue pill will keep them within the horizontal State they regard in their reality as a hierarchical pyramid, but that in reality is as flat as surf board. That little distinction is what separates humans from being free, truly free, and from putting an end to the out of control State.

 The key to liberating yourself from the abuses of the State resides on the ability to recognize that the State will do what you allow it to do and that it is its horizontal structure what makes it so evilly successful. In fact, the strength of the State does not come from itself, but from your relatives, neighbors, friends, co-workers, classmates and so on. In other words, the slave population to which you and I belong to. The slaves themselves support this system for a series of reasons. One, because they were taught to do that. Two, because they directly benefit from a trinket created by the State and they do not want to lose it. Three, because they do not wish that others surpass them and become more successful. Four, because the collapse of the system will mean a state of reality they cannot cope with. It is the ignorance, lack of humility and above all the indoctrination of the majority which prevents them from taking the red pill and opening their eyes to the real world. Instead, the slaves themselves guarantee the survival of the pyramidal looking State by attacking the minority who intends to warn them about the lie they live under. It is the voluntary acceptance of the false reality most people live in which allows the State to grow out of control. While most people waste time in senseless sports tribalism, racism, envy and cultural adequacy, their fellow slaves at the mid levels assure the social engineers that the State will continue to grow stronger.

 The horizontal nature of the State and they way it is used by the controllers to maintain most people blind and complacent is what explains the possibility of a few hundred people ruling over billions. It would be impossible otherwise. But it is exactly its very horizontal nature what presents people with the opportunity to break the chains from the State and to prevent it from growing larger and meaner. It is even possible, I would argue, not only to slim the State down, but also to make it work for the people, as most of us believe it should have always been. Change on this regard is not easy, however. It requires honesty from the part of those who want to ‘fix things’. If the success of the corrupt State relies upon the moral and practical support it receives from the slaves themselves, it is the withdrawal of that support what will end our slavery.

 If you pay your property taxes every year because you are afraid the State will come to raid your house and take you to jail, you are a slave of the State, and every time you pay your taxes you are a supporter of the State and as such its accomplice in all its wrongdoings. If you file your tax return and by doing so legitimize the powers of the State to tax your income, which is why you exist in the the States’ eyes, you are an accomplice of the State. If you do not like wars, but you vote for politicians who allow for the financing of invasions and killings in foreign countries, you are an accomplice of the invasions and the murder. If you do not like the corruption or inefficiency of the bureaucracy but you elect fellow slaves who will continue the back room and closed door deals, you are an accomplice of the State.

 However, the moment you become honest with yourself and gather some courage to awaken your fellow slaves, that will be the moment things will begin to change. But remember, change will not come through words or the use of language; it will come through action. If the success of the immoral State and its immoral actions is based on the support you give it, your withdrawal of that support is also what will liberate you from the chains that attach you to it. One cannot fight the dominant culture with the spoken word for the simple fact culture is made up and controls society through words. Because the controllers and their instruments of crime cannot manipulate truth, they manipulate language to cheat; and no one is better at that. They are unbeatable. That is why in order to end popular culture’s mad fake reality, individuals should use actions, not words. It is how much we act what we preach what will get us out of the giant farm we live in and in which we are milked to the last drop every day of our lives.

 Remember that the State and those who support statism approve of the use of violence against those who dare question their existence. That is, you may be arrested, imprisoned, tortured and raped if you oppose the State. So can you be a friend or acquaintance of a person who supports war, state taxation, corruption and violence against yourself? Wouldn’t you be an accomplice of his actions and therefore an accomplice of the State? I don’t know you, but I will not have anything to do with anyone who has the immoral audacity and cowardice to attack me for speaking the truth instead of opposing those who kill millions, steal our pensions, feed us toxic foods and make us sick with their pharmaceuticals.

 If a supposedly free human being cannot speak his mind and pay the price of being ostracized by his peers in exchange for real freedom, then, there is no hope from freedom. If we are afraid of being pointed at because we live by our own standards and refuse those that culture and the State impose on us, then we don’t deserve to be free.